Coca-Cola Owes the IRS An Insane Amount of Money In Back Taxes

When a regular person off the street screws up their taxes, the Internal Revenue Service (IRS) is all up their grill in a matter of months. But seems that if you're a massive global brand, you're allowed a little leeway.Coca-Cola apparently owes the IRS $3.3 billion in extra taxes, plus interest, from 2007 to 2009. Somehow the brand bafflingly got away with not paying this sum while the rest of us are hounded for coughing up our cash by April 15—or else.

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This debt stems from profits earned in foreign countries, where Coca-Cola's international locations manufacture, distribute, and sell products—which is considered taxable in the States. Bloomberg reports that the IRS recently audited the company for the tax years 2007, 2008, and 2009; and while no penalties have been placed, the financial agency told Coca-Cola that its top lawyer was on the case and advised the soda brand settle its debt swiftly.

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Critics of corporations with overseas profits say it shields those businesses from U.S. taxes with potential loopholes. But Coca-Cola is not alone: It's joined by Amazon and Microsoft in hot water with the IRS for international monetary affairs.

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On Friday, the soda company said in a statement that it plans to "pursue all administrative and judicial remedies necessary to resolve this matter" and that it has "followed the same methodology for determining U.S. taxable income from certain foreign company operations for nearly 30 years." The company has also requested to meet with the IRS chief counsel and may even file a petition in the U.S. Tax Court to challenge the claims.

According to federal law, companies owe the IRS up to 35 percent of profits earned around the world, but get credit for paying taxes to foreign governments. And the reason companies like Coke book income in low-tax countries is simple: The brand has raked in more than half of its net revenue there. Plus, its tax rate was cut by 11.5 percentage points due to so much of its earnings coming from outside of the U.S. What's more, Coca-Cola receives tax incentives from Brazil, Costa Rica, Singapore, and Swaziland. Because of this, the company had a total of $33.3 billion in profit—as of the end of 2014—via overseas on which it hasn't paid U.S. taxes.

Yet Coca-Cola stands firm, stating "We are among hundreds of other companies currently facing these types of [payment] adjustments … and we will vigorously defend our position. We are confident we will prevail on the merits of this case."